It has been three years since the city spent $6.5 million on the former University General Hospital with plans to build a housing and services facility for the homeless — a purchase that inspired community vitriol so rabid that the entire project has sat listless for years.
Now, the city may finally be throwing in the towel.
Council member Zarin Gracey submitted a memo last week asking for the Economic Development Committee to discuss selling the property at an upcoming meeting. The memo lists a mixed-use development balancing housing and retail as the preferred use for the site. The full City Council would have to approve the sale of the property following a recommendation from the Economic Development Committee.
Gracey, who was elected to the District 3 seat in a 2023 runoff election, inherited the controversial 2929 S. Hampton Road project and has pushed for the facility to be sold throughout his tenure. The city is expected to lose money on the sale — although financial matters are generally discussed in executive session so it's unclear just how much value the property has lost while in Dallas’ care.
Already, $35,000 a year has been spent on keeping the empty facility secure, city staff told the Housing and Homelessness Solutions Committee in January.
It was that meeting — where nearly every question asked about the Hampton Road hospital was answered with a “don’t know” or a “we’re waiting” — that motivated Gracey to formally ask the council to assess developer interest in the 12-acre property.
“It's continued to get pushed and pushed and pushed further and further back, and there's no movement there,” Gracey told the Observer
He added that he knows of at least two parties interested in taking the property off the city’s hands.
“This is a case where we're trying to come up with a solution for the entire city in a place where that solution doesn't make sense,” Gracey said. “I'm just trying to get some practicality to all of these things that we keep discussing. And for me, I have a vision, my constituents have a vision for what they wanna see in the area.”
Festering Community Distrust
A preliminary plan for the South Hampton Road facility showed more than 100 beds for the chronically homeless, office spaces, green areas and community amenities.
The property was purchased as part of the council’s plan to create permanent supportive housing complexes for the homeless in each council district. Distrust festered, though, when the neighboring community said they were left out of the planning process and blindsided by the city’s purchase. One of the chief concerns among residents has been the hospital’s proximity to Kiest Park and Brashear Elementary, which is connected to a Dallas Public Library branch.
“Yes, we need services for everyone in this city, including those most in need, but this is not the right spot,” Amy Smith, the mother of a Brashear student, told The Dallas Morning News after an especially contentious community meeting about the facility.
In the months after the hospital’s purchase, the city opinion seemed to be that the project was happening. Gracey, though, has taken a slower approach. When campaigning for council he stressed the importance of neighborhood self-determination, and said the city “dropped the ball” on the project’s handling.
“Some of my constituents think that it's a not-in-my-backyard conversation, and it's really not." — Zarin Gracey, District 3 City Council Member
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Gracey first inquired about selling the property early last year, but the council still wanted to make something work because of the undeniable need for homelessness services throughout the city. Council members and residents have also tossed around the idea of slicing up the parcel of land and developing affordable housing — the issue Gracey believes his constituents in the area want prioritized.
“Some of my constituents think that it's a not-in-my-backyard conversation, and it's really not,” Gracey said. “The discussion from the very beginning has only been about homelessness and not even housing. … The community wants housing, which is another crisis that we have.”
What complicated the housing proposal is the restricted bond funds used to purchase the property, which are earmarked specifically for homeless response. For several years, council members have worried that using the property for anything other than what its purchasing money was designated for would be a breach of community trust.
Last month, council member Adam Bazaldua asked if it could also lead to legal trouble for the city now that Proposition S — a City Charter amendment that allows residents to sue the city over failures to enforce local or state ordinances — is enforceable.
“If we acquired this property with the understanding that the voters thought it would be for one use, and we unilaterally make a decision otherwise, I’m concerned this opens us up to be vulnerable to litigation," Bazaldua told the committee.
Funding the Independence Drive Property
The council doesn't have an ethical or legal issue, though, if the funds from the property's sale are put toward a different homelessness solution. Just one month after purchasing the former hospital, the Dallas City Council approved a $5 million purchase of a TownHouse Suites near Duncanville to be turned into housing for the homeless. Redistricting has resulted in the hotel, located on Independence Drive, being added to District 3.“This all started with a policy that stated that every district would have some permanent supportive housing facility in their district,” Gracey said. “If that's still a policy to have one in every district, then the one in the area where I want to focus on and where the greatest need is, is the Independence property.”
Money from the hospital sale could be put toward the Independence property, which — like the South Hampton Road facility — sits empty three years later. City staff say more than 100 beds could be maintained at the property.
In a December Housing and Homelessness Solutions meeting, council member Cara Mendelsohn urged the council to put the funds from a sale toward completing the Independence Drive project.
"We literally kicked out people and made them homeless to create housing for people who are homeless, and nobody lives there," Mendelsohn said. "It is absolutely shocking."
